Massachusetts Estate Planning & Asset Protection Blog

What will 2017 bring to Seniors and Persons with Disabilities? - Part II

Posted by Dennis Sullivan & Associates on Tue, Jan 24, 2017

What will 2017 bring to Seniors and Persons with Disabilities? - Part II

In last week's blog 'What will 2017 Bring to Seniors and Persons with Disabilities? - Part I' we discussed some of the key issues to watch out for in 2017 including Medicare and Medicaid reform. In Part II of the blog we continue our review of potential impacts on legislation that affects seniors and persons with disabilities.

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Affordable Care Act

Republicans are already moving to repeal and replace Obamacare. The question is: How much will be repealed? There are several programs included in the ACA, not related to traditional health insurance, that are important to elder law attorneys and their clients. For example, Medicaid expansion, a kind of Medicaid reform, is part of the ACA.

The ACA also includes programs that work toward ending the institutional bias in Medicaid. One is Community First Choice, a state plan that provides home- and community-based services. Currently it has an extremely low-income threshold so it’s a limited population, but it’s a start.

Another is Money Follows the Person, which pays for transition services. For example, it could provide extra funds to help someone leave a nursing home, by paying for a housing coordinator to find an apartment, a roommate, buy basic furniture and so on.

We are moving toward home- and community-based service, which many people favor. How will that interact with Medicaid reforms? Because they are optional, some fear that with per capita caps, these services will be among the first to go. There may be more opportunities to expand these services through block grants because they allow more flexibility in what is offered. Along this line, Senator Chuck Schumer (D-NY) has introduced a bill called the Disability Integration Act, which would make home- and community-based services a civil right.

Other Medicaid-Related Issues to Watch

Limiting home equity: This proposal, H.R. 1361, would take away the state option to expand the cap for single individual home owners. It would not impact people who have a community spouse living in the home or if you have a disabled child or a dependent under 21. 

Medical liability reform: This could impact whether individuals get adequate access to personal injury settlements and funds that can be put into a special needs trust.

Long-Term Care Reform

There has been a lot of discussion on Capitol Hill about picking up the pieces on long-term care. After a decade, the market has completely collapsed. John Hancock just withdrew, and Genworth was bought out by a Chinese private equity firm. Republicans and Democrats agree on the problem, but there doesn’t seem to be common ground yet on a solution. The Senate Aging Committee is starting the process, which is a positive step. There are calls for catastrophic coverage, at least on the back end, and probably some sort of front-end coverage for two or three years. There may be some long-term care reform as part of Medicaid reform.

VA Benefit Rules

The new rules have been delayed again until at least April, 2017. Fixing the VA is a Trump priority. An important piece to what will happen with the VA is who Trump names to head the VA and Veterans Benefit Administration (VBA). 

Nursing home binding arbitration rules

Nursing homes must comply with binding arbitration rules to have access to Medicare or Medicaid funds. NAELA has been working with others to push CMS to ban pre-dispute binding arbitration. The for-profit nursing home industry association is fighting it and recently won a preliminary injunction in a Mississippi district court (American Health Care Association et al v. Burwell). We do not yet know if the Trump Administration will appeal this ruling and continue with banning binding arbitration for nursing home contracts. 

In Kindred Nursing Centers Limited Partnership v. Clark in Kentucky, the issue is whether federal arbitration acts overrule the state’s arbitration acts. The state of Kentucky has a law that says in order to waive the principal’s constitutional right to a jury trial, the agent must be given that specific authority within the power of attorney. Whether this is overturned is likely to hinge on President Trump’s pick to fill Justice Scalia’s vacancy on the Supreme Court.

 Conclusion

There are a number of issues that will be addressed in 2017 that can have significant impact on seniors and their loved ones, Veterans, and persons with disabilities. If you have questions or would like to discuss any of the issues raised here, please don’t hesitate to contact us.

At the Estate Planning & Asset Protection Law Center, we help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling approach so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future.

We encourage you to attend one of our free educational workshops. Call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy.

Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

 

Tags: disabled, seniors, Affordable Health Care Act, Veteran, VA benefits, VA, Medicaid, Nursing Home, Estate Planning, Elder Law, elder care, New estate tax law, new regulations, trusts, Nursing Home Costs, social security

VA is Proposing a 3 Year Look Back Together with a Penalty of Up To 10 Years

Posted by Dennis Sullivan & Associates on Mon, Feb 23, 2015

VA is Proposing a 3 Year Look Back Together with a Penalty of Up To 10 Years | Massachusetts Elder Law Attorney

 

veterans_benefits_lawyer 

On January 23, 2015, the VA took the initiative in proposing new regulations that would hit wartime veterans and their spouses with a penalty of up to 10 years for making gifts, if they wish to qualify for the VA’s Aid and Attendance program.

As readers of this blog know, the Aid and Attendance program is a non-service connected pension can provide as much as $2,120 per month in tax free income to help pay the cost of long term care.  This program is means tested with an asset limit of about $80,000.  Currently, there is no look back period like Medicaid has, so that transfers for less than fair value to individuals or trusts do not result in a waiting or penalty period for benefits.

Federal legislators have introduced two bills since 2012 seeking to impose a 3 year look back. Neither bill has managed to pass both houses of Congress yet though. The VA however, is sick of waiting and is trying to take matters into its own hands.  They have proposed a penalty of up to 10 years that would result from uncompensated transfers. The penalty itself would be calculated by dividing the amount of the transfer by the claimant’s pension rate. 

Other changes include a net worth standard of $119,220 including annual income. In other words, an applicant would need to have no more than $119,220 in assets and annual income combined in order to qualify.  The higher the applicant’s income, the lower the amount of assets they can keep.

Under the proposal, expenses related to independent living facilities would not count as care costs.  This would mean that veterans with dementia, or other degenerative diseases who can no longer safely live in their own homes but who don’t yet need assistance with the activities of daily living will not be able to include the cost of that facility in an effort to qualify for the VA benefit. Daily living activities are things like such as bathing, dressing, eating, toileting and transferring. Finally, the applicant’s home will remain an exempt asset towards the net worth limitation only if the lot on which it sits is less than 2 acres.

These changes will dramatically reduce the ability of many veterans to qualify for this important benefit.  The new regulations have been submitted for public comment.  To fight these changes, everyone who cares about veterans must respond no later than March 24, 2015.  You can send your comments through http://www.regulations.gov or by mail to Director, Regulation Policy and Management (02REG), Department of Veterans Affairs, 810 Vermont Ave. NW., Room 1068, Washington, DC 20420 or by fax to (202) 273-9026.  Comments should include that they are in response to “RIN 2900-AO73, Net Worth, Asset Transfers and Income Exclusions for Needs-Based Benefits”.

 

Click here to access our free report on Aid and Attendance Benefits.

At the Estate Planning & Asset Protection Law Center, we provide a unique education and counseling process which includes our unique 19 Point Trust, Estate and Asset Protection Review to help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones, click here for more information. We provide clients with a unique approach so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future.

We encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy.

 

 Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Tags: long term care, Nursing Homes, veterans benefits, Nursing Home, wartime veteran, Veteran, federal, look-back, VA benefits, penalty, 2015

Three Ways to Pay for Long Term Care part 2

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Fri, Aug 15, 2014

Three Ways to Pay for Long Term Care continued

Long term care insurance, IRA, trust

In our last post we were discussing the difficulties in funding long term care through either insurance or Medicaid.  Most insurance companies seem to be getting out of the long term care market entirely or drastically raising premiums.  Medicaid, the primary government program that covers long term care, is still a fall back for many.  But, there are gaps in terms of what it will and will not cover, and it is increasingly difficult for many to navigate the Medicaid system.

This is especially so given the two objectives most of our clients want to achieve: making sure they have enough money to meet their own needs as well as passing on a legacy to their children and grandchildren.  Without proper planning for long term care, however, the first objective may overwhelm the second, making it unachievable.

That’s where long term care insurance has sometimes helped.  It’s also where our specialty of setting up 5 year planning using trusts, has also helped.  But, sometimes there is no long term care insurance, it’s too late to get it and the legal solution can only go so far.

Self-funding with asset based long term care financial products just might be the answer.  As some insurance companies have left the long term care insurance market, others are now offering alternative ways to fund the care, such as life insurance or annuities.

These products allow your money to grow tax deferred.  It can then be used to pay for long term care and, unlike traditional long term care insurance you don’t have to worry about “using it or losing it”.  A death benefit is paid to your heirs if you don’t use it (or only use some).

The longer you wait until you start drawing out the investment, the more time to build up the account value for use as long term care.  While these investments don’t return the higher rates that can be gained in the market, they also don’t put your principal at risk, meaning you won’t lose any of it if there is another 10 to 30% market correction.  For those who have their money sitting in CDs and cash earning less than 1%, the higher rates are a clear bonus.

Many of these products do not have the same underwriting requirements that exist for long term care insurance.  Whereas a diagnosis of dementia or being age 75 or older would preclude Long Term Care Insurance entirely, these asset based products may still be an option, even as late as age 85.

For our clients with large IRA accounts who want to protect some of that account for loved ones, moving the money to a trust results in a large income tax bill because the account can no longer remain tax deferred.  However, purchasing asset based long term products within the IRA can allow the account to remain tax deferred, increase the income value significantly if long term care is needed, and provide a death benefit for your loved ones if not needed.

 

At the Estate Planning & Asset Protection Law Center, we help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling approach so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future.

We encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy.

Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Tags: Nursing Home Costs, long term care, veterans benefits, VA benefit, VA benefits, Massachusetts, Nursing Home, Veteran, VA, Nursing Home, long term care insurance

There Are Three Ways to Pay for Long Term Care

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Tue, Aug 12, 2014

The Three Ways to Pay for Long Term Care

VA Long Term Care

As we always explain to people, there are 3 ways to pay for long term care:  The first way is to use your own money.  The second source is long term care insurance and the third is government benefits, primarily Medicaid and the VA Aid and Attendance program.

We have written before in this blog about government benefits, especially Medicaid.  Because long term care is so expensive and so many people run out of money, Medicaid, as a last resort, must always be considered. Unfortunately, the economy is still struggling and tax revenues, which provide the funding for Medicaid, are down.  State and Federal governments are always looking for ways to cut costs and Medicaid is likely to continue to be a target for them.  The VA Aid and Attendance benefit, which has been a help to some, is not a total solution by itself and is also likely to be more restrictive.  Of course, VA benefits have never been an option for the non-Veteran senior population.  As we see fewer World War II veterans, there are fewer Korean veterans behind them, and still fewer Vietnam veterans coming behind them.

Long term care insurance is an important piece as well, unfortunately, all too often we find that too many people don’t have it, and when they do seriously consider purchasing the insurance, just as they start to think that they just might need long term care, it’s too late. They are now too old or too ill to pass insurance underwriting requirements.

What we have also seen, and what we have written about in the past, is the change occurring as a result of an aging population and poor forecasting by the insurance industry.  Many companies have dropped out of the long term care market altogether.  Others have presented their policyholders with large premium increases with the promise of more to follow each year.  America’s seniors are faced with the choice of paying the increases or cutting their coverage.

So, what other options are there for seniors looking for coverage?  Let’s go back to the first way to pay for care, self-funding or using your own money.  We see so many seniors who fall into one of two categories:  Some have their savings heavily invested in the stock market and other investments that are too risky for someone who could need large amounts of principal to pay for long term care.  If the market drops by 25% or more again like it did a few years ago, many seniors won’t have the ability to hold on till their investments recover. Others have gone the other way and put their savings in bank accounts and CDs that earn less than 1%.  The principal is safe from market fluctuations but they are getting a next to nothing rate of return.  Coupled with Social Security and small pensions, most seniors today have income in the $2000 to $4000 per month range; not enough to meet their monthly expenses without dipping into the principal.

So, is there are another way?  The answer, happily, is yes.  With asset based long term care products, there is a way to self-fund the cost of long term care and have something left for your spouse, children and loved ones.  We’ll tell you more about it in our next blog post, so be sure to watch for it.

At the Estate Planning & Asset Protection Law Center, we help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling approach so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future.

We encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy.

Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Tags: massachusetts estate planning strategies, Nursing Home Costs, long term care, Nursing Homes, VA benefit, VA benefits, Massachusetts, Nursing Home, incapacity, senior, Veteran, VA, Nursing Home, long term care insurance

VA Rules are Changing: NEW Three Year Look Back! | Massachusetts Elder Law Attorney

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Fri, Nov 08, 2013

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The winds of change are blowing over the VA landscape.  I’ve written about this in the past and the time may soon be here.  These are changes that you need to understand.

 Over the years, many of our clients have been able to qualify for an Improved Pension (sometimes called Aid and Attendance Benefit) to help pay for the cost of long term care, whether that be in an assisted living facility or nursing home or to enable them to stay home longer. This VA benefit has helped many people meet the high cost of care and stretch their dollars.

 In order to be eligible for the VA benefit, as a rule of thumb, claimants had to have assets totaling less than about $80,000 (not counting their home or car). They also had to meet the VA income rules. While giving away assets triggers a five year look-back under the Medicaid rules, under the VA rules there is no look-back period for gifts or asset transfers.

 All of that may be about to change under new VA legislation making its way through the House and Senate.

 While the legislation has not yet been voted on, there are commonalities in the bills which tell us that a change in the law is near. Among the biggest proposed changes are the following:

  • A penalty with a three year look-back for asset transfers under the VA rules.

  • Under the new rules, transferring money into a Vet Trust or into an annuity will also trigger the three year look-back period.

  • What’s more, penalties caused by an asset transfer from a now-deceased spouse will carry over to the surviving spouse.

 As with so many bills that wind through the legislative process, no one can know for sure what the final result will be until the House and Senate have each voted and then reconciled their respective bills and then the President must sign it. Our best guess is that the new legislation will probably make its way to a vote early next year and it appears likely that it will become the law of the land at that time.

 For that reason, people who are eyeing VA eligibility would do well to get their plans in place now before the anticipated law changes. Any new law will be prospective only, meaning opportunities still exist now under the current laws.

At the Estate Planning & Asset Protection Law Center, we help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling approach so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future.

We encourage you to attend one of our free educational workshops, call 800-964-4295 and register to learn more about what you can do to enhance the security of your spouse, home, life savings and legacy.

Tags: Estate Planning, asset protection, veterans benefits, VA benefits, Veteran, VA, 2013

Massachusetts VA Benefit Attorney | Is the VA Aid and Attendance Benefit Counted as Income?

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Mon, Nov 19, 2012

The deadline for Medicare’s open enrollment is three weeks earlier this year that 2011, so boomers need to gather all the necessary information regarding changes and updates to care now to make the best decisions for the health and finances.

The deadline of Dec. 7 is right around the corner and the more information boomers have about the plans, the better off they will be now and down the road.

 A new federal ruling could transform the way that Medicare covers long-term care and allows more patients to receive home health care services.

I sat down with Robert Quinlan, an independent insurance agent/broker since 1986 in New Windsor, N.Y. and had him review the following: 

Boomer: Please explain how a recent court decision on Medicare services could impact boomers now and in the future.

Quinlan: The federal case in Vermont called Jimmo vs Sebelius was decided last month and expands Medicare’s skilled care services to people who needed care to maintain their health or prevent or slow further deterioration.

Prior to this decision, Medicare would not approve skilled care services to those who had no prospects for improvement in their health like people with Alzheimer’s disease, Parkinson’s disease, multiple sclerosis or patients that have had a stroke.

The potential for more Medicare paid services will be limited to skilled care, which is care provided by licensed professionals like physical therapy, respiratory therapy, speech therapy or care from registered nurses. There will be no restrictions on the types of diseases that will be covered.

The lawsuit was brought by a class of individuals receiving Medicare services and other organizational plaintiffs like the National Multiple Sclerosis Society and the Paralyzed Veterans of America. The case’s defendant was Kathleen Sebulius, U.S. Secretary of Health, and Human Services who represents the federal government’s Medicare program. 

The ruling will not expand other Medicare services today. For example, nursing home coverage will still be limited to 100 days. Medicare costs for skilled care services are expected to rise in the short term, but longer-term costs for nursing homes and hospitals could be lower if more people receive better care at home and avoid more costly care later. 

Why does this case matter? People with chronic illnesses and accidents have been denied skilled care under Medicare because their condition was not improving. Now there is the likelihood that these people will receive more robust care that has eluded them in the past.

The final settlement of the case must be approved by the court which is expected to take several more weeks. Stay tuned! 

Boomer: Are there tax benefits available for small business owners who want to buy long-term care insurance?

Quinlan: Yes, there are federal tax benefits when you purchase long term care insurance (LTCI) as a business owner. If you are:

  • Self employed: you can deduct 100% of your long-term care insurance premiums up to the IRS’s “Eligible Premium” amounts. For example, the 2012 tax deduction limit is $350 starting at age 40 or less, going to $3,500 if you are age 61 but not yet age 71 and $4,370 for people age 71 and older.
  • Partnership, LLC or subchapter S corporation: The partnership, LLC or Subchapter S pays the LTCI premium. You may deduct up to 100% of the age-based Eligible Premium like the self employed person with no age criteria.
  • Subchapter C corporation – entitled to a 100% deduction of the LTCI premium as a business expense on the total premium paid. The deduction is not limited to the “Eligible Premium” schedule.
  • Individuals:  LTCI premiums are considered medical expenses for individuals . For a person who itemizes tax deductions, medical expenses are tax deductible if they exceed 7.5% of the person’s adjusted gross income in tax year 2012. The amount that can be deducted as a medical expense is limited to the IRS’s “Eligible Premium” that is referred in the above “Self Employed” section.

 In addition to these federal tax benefits, your state may also have a tax benefit for LTCI premiums. For example, New York State permits tax payers to take a 20% tax credit (better than a tax deduction) on the LTCI premiums with no 7.5% adjusted gross income rule or age threshold. For example, if you paid an annual premium of $4,000 for your long term care insurance, you would receive $800 tax credit ($4,000 times 20%) on your NYS tax bill.

 The above information is only intended as general information. As in all tax matters, check with your own tax/financial advisor before taking action.

Boomer: I have seen many ads about Medicare insurance plans since September, and I have noticed that some Medicare insurance plans offered by private insurance companies have zero or low premiums, namely Medicare Advantage plans (Part C). How is that possible? Do these plans offer comprehensive coverage like coverage in original Medicare Parts A and B?

Quinlan: Medicare Advantage plans are provided by private insurance companies that are required by law to have comparable services as the original Medicare Parts A (hospital insurance) and B (medical insurance). Plus they also offer additional services like prescription drug coverage and vision care. Some plans will also pay for membership in gyms. The premiums for these Medicare Advantage plans are often low premiums or no premiums (not a misprint). How is this possible? The federal government pays the private insurance companies to offer these services to local communities across the US. About 25% of Medicare eligible Americans are covered by these plans today. 

Your doctors and hospitals must be part of the network in your Medicare Advantage plan. You will pay more money for out of network services. Insurance companies may not offer these plans in every county in your state. Check with your local insurance company or insurance agent/broker if these plans are offered in your county. You must also be enrolled in Medicare Parts A and B to enroll in these Medicare Advantage plans. You will not need to purchase a Medicare supplement plan.

 Now until December 7, 2012 is a good time to review your current Medicare coverage to make any plan changes during this year’s Medicare open enrollment period. New plan coverage will become effective January 1, 2013.



Read more: http://www.foxbusiness.com/personal-finance/2012/11/15/what-boomers-need-to-know-about-medicare-changes/#ixzz2CgaTfuN5

The deadline for Medicare’s open enrollment is three weeks earlier this year that 2011, so boomers need to gather all the necessary information regarding changes and updates to care now to make the best decisions for the health and finances.

The deadline of Dec. 7 is right around the corner and the more information boomers have about the plans, the better off they will be now and down the road.

 A new federal ruling could transform the way that Medicare covers long-term care and allows more patients to receive home health care services.

I sat down with Robert Quinlan, an independent insurance agent/broker since 1986 in New Windsor, N.Y. and had him review the following: 

Boomer: Please explain how a recent court decision on Medicare services could impact boomers now and in the future.

Quinlan: The federal case in Vermont called Jimmo vs Sebelius was decided last month and expands Medicare’s skilled care services to people who needed care to maintain their health or prevent or slow further deterioration.

Prior to this decision, Medicare would not approve skilled care services to those who had no prospects for improvement in their health like people with Alzheimer’s disease, Parkinson’s disease, multiple sclerosis or patients that have had a stroke.

The potential for more Medicare paid services will be limited to skilled care, which is care provided by licensed professionals like physical therapy, respiratory therapy, speech therapy or care from registered nurses. There will be no restrictions on the types of diseases that will be covered.

The lawsuit was brought by a class of individuals receiving Medicare services and other organizational plaintiffs like the National Multiple Sclerosis Society and the Paralyzed Veterans of America. The case’s defendant was Kathleen Sebulius, U.S. Secretary of Health, and Human Services who represents the federal government’s Medicare program. 

The ruling will not expand other Medicare services today. For example, nursing home coverage will still be limited to 100 days. Medicare costs for skilled care services are expected to rise in the short term, but longer-term costs for nursing homes and hospitals could be lower if more people receive better care at home and avoid more costly care later. 

Why does this case matter? People with chronic illnesses and accidents have been denied skilled care under Medicare because their condition was not improving. Now there is the likelihood that these people will receive more robust care that has eluded them in the past.

The final settlement of the case must be approved by the court which is expected to take several more weeks. Stay tuned! 

Boomer: Are there tax benefits available for small business owners who want to buy long-term care insurance?

Quinlan: Yes, there are federal tax benefits when you purchase long term care insurance (LTCI) as a business owner. If you are:

  • Self employed: you can deduct 100% of your long-term care insurance premiums up to the IRS’s “Eligible Premium” amounts. For example, the 2012 tax deduction limit is $350 starting at age 40 or less, going to $3,500 if you are age 61 but not yet age 71 and $4,370 for people age 71 and older.
  • Partnership, LLC or subchapter S corporation: The partnership, LLC or Subchapter S pays the LTCI premium. You may deduct up to 100% of the age-based Eligible Premium like the self employed person with no age criteria.
  • Subchapter C corporation – entitled to a 100% deduction of the LTCI premium as a business expense on the total premium paid. The deduction is not limited to the “Eligible Premium” schedule.
  • Individuals:  LTCI premiums are considered medical expenses for individuals . For a person who itemizes tax deductions, medical expenses are tax deductible if they exceed 7.5% of the person’s adjusted gross income in tax year 2012. The amount that can be deducted as a medical expense is limited to the IRS’s “Eligible Premium” that is referred in the above “Self Employed” section.

 In addition to these federal tax benefits, your state may also have a tax benefit for LTCI premiums. For example, New York State permits tax payers to take a 20% tax credit (better than a tax deduction) on the LTCI premiums with no 7.5% adjusted gross income rule or age threshold. For example, if you paid an annual premium of $4,000 for your long term care insurance, you would receive $800 tax credit ($4,000 times 20%) on your NYS tax bill.

 The above information is only intended as general information. As in all tax matters, check with your own tax/financial advisor before taking action.

Boomer: I have seen many ads about Medicare insurance plans since September, and I have noticed that some Medicare insurance plans offered by private insurance companies have zero or low premiums, namely Medicare Advantage plans (Part C). How is that possible? Do these plans offer comprehensive coverage like coverage in original Medicare Parts A and B?

Quinlan: Medicare Advantage plans are provided by private insurance companies that are required by law to have comparable services as the original Medicare Parts A (hospital insurance) and B (medical insurance). Plus they also offer additional services like prescription drug coverage and vision care. Some plans will also pay for membership in gyms. The premiums for these Medicare Advantage plans are often low premiums or no premiums (not a misprint). How is this possible? The federal government pays the private insurance companies to offer these services to local communities across the US. About 25% of Medicare eligible Americans are covered by these plans today. 

Your doctors and hospitals must be part of the network in your Medicare Advantage plan. You will pay more money for out of network services. Insurance companies may not offer these plans in every county in your state. Check with your local insurance company or insurance agent/broker if these plans are offered in your county. You must also be enrolled in Medicare Parts A and B to enroll in these Medicare Advantage plans. You will not need to purchase a Medicare supplement plan.

 Now until December 7, 2012 is a good time to review your current Medicare coverage to make any plan changes during this year’s Medicare open enrollment period. New plan coverage will become effective January 1, 2013.



Read more: http://www.foxbusiness.com/personal-finance/2012/11/15/what-boomers-need-to-know-about-medicare-changes/#ixzz2CgaTfuN5

The deadline for Medicare’s open enrollment is three weeks earlier this year that 2011, so boomers need to gather all the necessary information regarding changes and updates to care now to make the best decisions for the health and finances.

The deadline of Dec. 7 is right around the corner and the more information boomers have about the plans, the better off they will be now and down the road.

 A new federal ruling could transform the way that Medicare covers long-term care and allows more patients to receive home health care services.

I sat down with Robert Quinlan, an independent insurance agent/broker since 1986 in New Windsor, N.Y. and had him review the following: 

Boomer: Please explain how a recent court decision on Medicare services could impact boomers now and in the future.

Quinlan: The federal case in Vermont called Jimmo vs Sebelius was decided last month and expands Medicare’s skilled care services to people who needed care to maintain their health or prevent or slow further deterioration.

Prior to this decision, Medicare would not approve skilled care services to those who had no prospects for improvement in their health like people with Alzheimer’s disease, Parkinson’s disease, multiple sclerosis or patients that have had a stroke.

The potential for more Medicare paid services will be limited to skilled care, which is care provided by licensed professionals like physical therapy, respiratory therapy, speech therapy or care from registered nurses. There will be no restrictions on the types of diseases that will be covered.

The lawsuit was brought by a class of individuals receiving Medicare services and other organizational plaintiffs like the National Multiple Sclerosis Society and the Paralyzed Veterans of America. The case’s defendant was Kathleen Sebulius, U.S. Secretary of Health, and Human Services who represents the federal government’s Medicare program. 

The ruling will not expand other Medicare services today. For example, nursing home coverage will still be limited to 100 days. Medicare costs for skilled care services are expected to rise in the short term, but longer-term costs for nursing homes and hospitals could be lower if more people receive better care at home and avoid more costly care later. 

Why does this case matter? People with chronic illnesses and accidents have been denied skilled care under Medicare because their condition was not improving. Now there is the likelihood that these people will receive more robust care that has eluded them in the past.

The final settlement of the case must be approved by the court which is expected to take several more weeks. Stay tuned! 

Boomer: Are there tax benefits available for small business owners who want to buy long-term care insurance?

Quinlan: Yes, there are federal tax benefits when you purchase long term care insurance (LTCI) as a business owner. If you are:

  • Self employed: you can deduct 100% of your long-term care insurance premiums up to the IRS’s “Eligible Premium” amounts. For example, the 2012 tax deduction limit is $350 starting at age 40 or less, going to $3,500 if you are age 61 but not yet age 71 and $4,370 for people age 71 and older.
  • Partnership, LLC or subchapter S corporation: The partnership, LLC or Subchapter S pays the LTCI premium. You may deduct up to 100% of the age-based Eligible Premium like the self employed person with no age criteria.
  • Subchapter C corporation – entitled to a 100% deduction of the LTCI premium as a business expense on the total premium paid. The deduction is not limited to the “Eligible Premium” schedule.
  • Individuals:  LTCI premiums are considered medical expenses for individuals . For a person who itemizes tax deductions, medical expenses are tax deductible if they exceed 7.5% of the person’s adjusted gross income in tax year 2012. The amount that can be deducted as a medical expense is limited to the IRS’s “Eligible Premium” that is referred in the above “Self Employed” section.

 In addition to these federal tax benefits, your state may also have a tax benefit for LTCI premiums. For example, New York State permits tax payers to take a 20% tax credit (better than a tax deduction) on the LTCI premiums with no 7.5% adjusted gross income rule or age threshold. For example, if you paid an annual premium of $4,000 for your long term care insurance, you would receive $800 tax credit ($4,000 times 20%) on your NYS tax bill.

 The above information is only intended as general information. As in all tax matters, check with your own tax/financial advisor before taking action.

Boomer: I have seen many ads about Medicare insurance plans since September, and I have noticed that some Medicare insurance plans offered by private insurance companies have zero or low premiums, namely Medicare Advantage plans (Part C). How is that possible? Do these plans offer comprehensive coverage like coverage in original Medicare Parts A and B?

Quinlan: Medicare Advantage plans are provided by private insurance companies that are required by law to have comparable services as the original Medicare Parts A (hospital insurance) and B (medical insurance). Plus they also offer additional services like prescription drug coverage and vision care. Some plans will also pay for membership in gyms. The premiums for these Medicare Advantage plans are often low premiums or no premiums (not a misprint). How is this possible? The federal government pays the private insurance companies to offer these services to local communities across the US. About 25% of Medicare eligible Americans are covered by these plans today. 

Your doctors and hospitals must be part of the network in your Medicare Advantage plan. You will pay more money for out of network services. Insurance companies may not offer these plans in every county in your state. Check with your local insurance company or insurance agent/broker if these plans are offered in your county. You must also be enrolled in Medicare Parts A and B to enroll in these Medicare Advantage plans. You will not need to purchase a Medicare supplement plan.

 Now until December 7, 2012 is a good time to review your current Medicare coverage to make any plan changes during this year’s Medicare open enrollment period. New plan coverage will become effective January 1, 2013.



Read more: http://www.foxbusiness.com/personal-finance/2012/11/15/what-boomers-need-to-know-about-medicare-changes/#ixzz2CgaTfuN5


Read more: http://www.foxbusiness.com/personal-finance/2012/11/15/what-boomers-need-to-know-about-medicare-changes/#ixzz2CgaTfuN5

I get this question frequently.  Does Medicaid count the VA benefit as income for eligibility purposes is more specifically the question.  The answer is “no, it is not”.  There is a specific Medicaid Communication (25 years old) that states that VA Aid & Attendance benefits are not counted as income.  Please be aware that there are other VA benefits, however, that may be treated as income and also be aware that it is the aid and attendance portion of the benefit that is not countable.  How much that turns out to be depends on each individual case.  You must examine your award letter.

                Please also note that the VA benefit will drop to $90 per month when the recipient qualifies for Medicaid.  When there is a spouse at home, the community spouse may be entitled to receive more than $90 per month.   Our practice with our elder law clients is to notify the VA when Medicaid is approved (but not when we file the application since we don’t want the benefit to stop until Medicaid is approved).

I get this question frequently.  Does Medicaid count the VA benefit as income for eligibility purposes is more specifically the question.  The answer is “no, it is not”.  There is VA, veteran, Medicaid, benefita specific Medicaid Communication (25 years old) that states that VA Aid & Attendance benefits are not counted as income.  Please be aware that there are other VA benefits, however, that may be treated as income and also be aware that it is the aid and attendance portion of the benefit that is not countable.  How much that turns out to be depends on each individual case.  You must examine your award letter.

                Please also note that the VA benefit will drop to $90 per month when the recipient qualifies for Medicaid.  When there is a spouse at home, the community spouse may be entitled to receive more than $90 per month.   Our practice with our elder law clients is to notify the VA when Medicaid is approved (but not when we file the application since we don’t want the benefit to stop until Medicaid is approved).

For more information go to www.SullivanVeteransReport.com, which contains important information on the “Hidden Benefit” available to veterans and their spouses, and the steps you should be taking right now to find out if your loved one qualifies.

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